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Bank in South Florida Files $8.5 Million Lawsuit

Agricultural companies exist throughout southern and central Florida. It’s also no secret that this part of the country was hit especially hard by the foreclosure epidemic that swept the entire nation when the recession landed. These two elements help explain why the Floridian Community Bank recently filed a lawsuit for $8.45 million on the basis of foreclosure and asset repossession against a group of agricultural companies throughout the area.

Specifically, these agricultural companies are involved with plant nurseries, tree farming and landscaping. Again, given the prevalence of foreclosures in Florida, it perhaps isn’t that surprising that this story is happening, although the amount is definitely extremely high.

Parties Involved

Based out of Davie, The Floridian Community Bank filed the lawsuit against Foremost Inc., Lake Nona Outdoors, Quail Roost Tree Farms, Medallion Tree Farms, Check Cashing USA Holdings, Davie Nurseries and Labor Factors. However, guarantors are involved as well. Those parties include Daniel S. Osman, Stephen T. Garrison Jr., Martin Osman, Kelly Osman, Jack A. Osman, Ellen Osman and Brian Socolow.

John M. Mullin, an attorney based out of Fort Lauderdale, is representing Floridian Community Bank in the suit. In the complaint, it was requested that the above businesses appoint a receiver in order to represent them. At this time, though, none has been publicly appointed.

The main property that is the focus of the suit is a site owned by Quail Roost Tree Farm. This 10.3-acre location is based at 150 S.W. 202nd Street in Homestead. Floridian Community Bank is also targeting a 1,100-square foot home owned by Brian Socolow, one of the guarantors. That one is located at 12416 S.W. 110th South Canal Street Road.

Heart of the Issue

As we mentioned above, the lawsuit is a foreclosure and repossession filing. It concerns eight loans that were given to the above companies and cross-collateralized. These loans went into default—allegedly—at the end of 2015. At that point, though, payments were mandated under a previous forbearance agreement and had also not been paid.

Defendant’s Response

Although there hasn’t been a receiver named to the defendants yet, one of the guarantors mentioned in the suit, Jack Osman, responded by saying that, “We feel like their positions are wrong and it will all come out in the litigation. We just don’t agree with their positions.”

Other Collateral Being Targeted

Aside from the foreclosure, the lawsuit is also looking to repossess assets owned by the companies listed above too. This would include not just their equipment, but also plants and trees.

Other properties mentioned in the suit include:

  • Lake Nona Outdoors
  • Davie Nurseries
  • Medallion Tree Farms

Combined, these three companies still own seven properties located throughout Florida.

The largest of the eight loans mentioned in the lawsuit is worth $4.83 million. It was to Check Cashing USA, but was secured by a loan to Buckeye Check Cashing that was for $8 billion.

The Importance of This Case for Floridian Community Bank

Obviously, this is a large sum of money for any bank, but Floridian Community Bank has some $378 million in assets. At the end of 2015, the bank reported $6.5 million in loans that aren’t current. $4 million of them are backed by farmland too.

Whether or not Floridian Community Bank actually has a case or not is yet to be seen. The fact that Florida has seen a big hit to their economy from the recession would make this sort of thing not completely hard to believe. At the same time, given the bank’s amount of noncurrent loans at the moment, it wouldn’t be too surprising if this was also an attempt to simply pull in their payments.

Source:

http://www.bizjournals.com/southflorida/news/2016/02/18/south-florida-bank-files-8-5m-lawsuit-against.html